Since February 2011, DPU has held ongoing stakeholder hearings to discuss the specifics of the net metering queue and in late April issued its “Staff Proposal.” This proposal instructs distribution companies to allow a project developer to occupy a place in its queue, reserving a stated amount of capacity within the strict aggregate cap, upon submission of a complete application to interconnect as a net metering facility. There will be strict deadlines for exiting the queue (i.e. when a project becomes operational or fails to achieve its required development milestones) that will likely vary based upon project specifics such as energy type, facility Class and ownership.

Under the DPU proposal a complete application would include: (a) an executed interconnection service agreement tendered by the distribution company, (b) adequate site control (a sufficient interest in real estate or other contractual right to build the facility at the location specified in the interconnection service agreement), and (c) all necessary governmental permits and approvals to construct the project. The last of these allows an exception for “ministerial permits,” such as a building permit (notwithstanding the pendency of any challenge to the granting of any such permit or approval). While this proposal provides some of the assurance project developers seek, it is lacking in one important respect; project developers may not extend the reservation period beyond that granted by the DPU, and may not make material changes to the project without losing the allocation. Should these restrictions remain project development may suffer, as such minor delays and changes are the norm in renewables development of this scale.

Ultimately, it is unclear whether DPU will create new regulations based on its proposal, and discussions with the industry. It is clear, however, that project developers, and their lenders, are in need of the assurances that such regulations would provide. If DPU does provide new regulations it will have to undergo the rulemaking process, including notice and opportunity to comment.

Because the aggregate capacity of net metered facilities is capped for each distribution company, it is not enough that the project developer has complied with all requirements. Eventually, eligible projects could be barred from these incentives because the cap has been met. The only true assurance that a project will receive net metering benefits is acknowledgement of eligibility and reservation of capacity by a distribution company. Massachusetts provides this assurance through the net metering queue.